- High street stores would struggle amidst competition from online retailers.
- Shopping centres would continue to dominate.
Some 22 months on, how’s it looking out there? Let’s take Birmingham as an example.
The obvious place to start is the shiny new ‘Grand Central‘ shopping centre (and it really is shiny!), offering customers a variety of luxury stores and restaurants – ‘John Lewis’ being the anchor tenant and the big attraction.
At a reported build cost of £250m, Grand Central certainly wasn’t cheap, and the tenants currently reaping the benefits of Birmingham’s latest landmark are paying handsomely for the privilege. But early signs indicate that the gamble was worthwhile, with customers flocking to see what all the fuss is about. Sure, the price per square metre may be a tad expensive, but this is now prime real estate.
Technology giant, ‘Apple’, have not moved in to Grand Central, but the news on the grapevine is that they have agreed terms to open a new flagship store next to the Bullring (replacing the iconic six-storey Waterstones building).
The introduction of a new metro line (coming soon) taking passengers from Birmingham’s Snow Hill Station directly to Grand Central and the Bullring further emphasises the dominance and importance of shopping centres to the heart of most major towns and cities. Rents are high and competition is fierce but, for retail tenants, this remains the place to be.
How have the high streets coped?
As predicted, the high streets continue to struggle.
High streets within walking distance of major shopping centres have inevitably benefitted from the high levels of footfall. But for others, however, the situation is still precarious, with many tenants closing stores and paying hefty sums to bring leases to an end early.
That said, there appear to be fewer vacant shops compared to 2 years ago, which is certainly an encouraging sign. This may be partly due to landlords reducing rents in order to keep/attract tenants. After all, some rent is better than no rent. For innovative tenants, this could present a great opportunity.
It will be interesting to see how the market changes over the next 18 months.